exv10w16



 





Exhibit 10.16




MONEYGRAM EMPLOYEE EQUITY TRUST




Effective as of June 30, 2004




 









 








TABLE OF CONTENTS




	 	 	 	 	 	 	 
	 	 	 	 	Page

	ARTICLE 1.
	 	Trust, Trustee and Trust Fund	 	 	5	 
	1.1
	 	Trust	 	 	5	 
	1.2.
	 	Trustee	 	 	5	 
	1.3.
	 	Trust Fund	 	 	5	 
	1.4.
	 	Trust Fund Subject to Claims	 	 	5	 
	1.5.
	 	Definitions	 	 	6	 
	ARTICLE 2.
	 	Contributions and Dividends	 	 	9	 
	2.1.
	 	Contributions	 	 	9	 
	2.2.
	 	Dividends	 	 	10	 
	ARTICLE 3.
	 	Release and Allocation of Company Stock	 	 	10	 
	3.1.
	 	Release of Shares	 	 	10	 
	3.2.
	 	Allocations	 	 	10	 
	3.3.
	 	Excess Shares	 	 	10	 
	ARTICLE 4.
	 	Compensation, Expenses and Tax Withholding	 	 	11	 
	4.1.
	 	Compensation and Expenses	 	 	11	 
	4.2.
	 	Withholding of Taxes	 	 	12	 
	ARTICLE 5.
	 	Administration of Trust Fund	 	 	12	 
	5.1.
	 	Management and Control of Trust Fund	 	 	12	 
	5.2.
	 	Investment of Funds	 	 	12	 
	5.3.
	 	Trustee’s Administrative Powers	 	 	12	 
	5.4.
	 	Voting and Tendering of Company Stock	 	 	14	 
	5.5.
	 	Indemnification	 	 	15	 
	5.6.
	 	General Duty to Communicate to Committee	 	 	16	 
	ARTICLE 6.
	 	Accounts and Reports of Trustee	 	 	16	 
	6.1.
	 	Records and Accounts of Trustee	 	 	16	 
	6.2.
	 	Fiscal Year	 	 	16	 
	6.3.
	 	Reports of Trustee	 	 	16	 
	6.4.
	 	Final Report	 	 	16	 
	ARTICLE 7.
	 	Succession of Trustee	 	 	16	 
	7.1.
	 	Resignation of Trustee	 	 	16	 
	7.2.
	 	Removal of Trustee	 	 	16	 
	7.3.
	 	Appointment of Successor Trustee	 	 	17	 
	7.4.
	 	Succession to Trust Fund Assets	 	 	17	 
	7.5.
	 	Continuation of Trust	 	 	17	 
	7.6.
	 	Changes in Organization of Trustee	 	 	17	 
	7.7.
	 	Continuance of Trustee's Powers in Event of Termination of the Trust	 	 	17	 







-2-









 






	 	 	 	 	 	 	 
	 	 	 	 	Page

	ARTICLE 8.
	 	Amendment or Termination	 	 	17	 
	8.1.
	 	Amendments	 	 	17	 
	8.2.
	 	Termination	 	 	18	 
	8.3.
	 	Form of Amendment or Termination	 	 	18	 
	ARTICLE 9.
	 	Miscellaneous	 	 	18	 
	9.1.
	 	Controlling Law	 	 	18	 
	9.2.
	 	Committee Action	 	 	18	 
	9.3.
	 	Notices	 	 	19	 
	9.4.
	 	Severability	 	 	19	 
	9.5.
	 	Protection of Persons Dealing with the Trust	 	 	19	 
	9.6.
	 	Tax Status of Trust	 	 	19	 
	9.7.
	 	Participants to Have No Interest in the Company by Reason of the Trust	 	 	19	 
	9.8.
	 	Nonassignability	 	 	19	 
	9.9.
	 	Gender and Plurals	 	 	20	 
	9.10.
	 	Counterparts	 	 	20	 







-3-









 






MONEYGRAM EMPLOYEE EQUITY TRUST




          THIS TRUST AGREEMENT (the “Agreement”) made effective as of June 30, 2004,
between MoneyGram International, Inc., a Delaware corporation (the “Company”),
and Wells Fargo Bank, N.A., a national banking association (the “Trustee”), as
trustee.



W I T N E S S E T H :




          WHEREAS, pursuant to the Separation and Distribution Agreement dated as of
June 30, 2004 (the “Separation and Distribution Agreement”) by and among Viad
Corp, a Delaware corporation (“Viad”), Travelers Express Company, Inc., and MGI
Merger Sub, Inc., the Company will become an independent, publicly traded
corporation through a distribution (the “Distribution”) of all of the Company
Stock (as defined below) owned by Viad to holders of shares of Viad Common
Stock (as defined in the Separation and Distribution Agreement); and



          WHEREAS, in connection with the Distribution, it has been agreed in the
Employee Benefits Agreement dated as of June 30, 2004 by and among Viad, the
Corporation and TECI (the “Employee Benefits Agreement”) that (1) the trustee
of the Viad Corp Employee Equity Trust created pursuant to the Trust Agreement
dated as of August 15, 1996, between Viad and Wells Fargo Bank of Arizona,
N.A., as trustee (the “Viad Trust”), will transfer to the trustee of a new
trust established by MoneyGram, effective as of June 30, 2004, all of the
shares of Company Stock distributed in the Distribution with respect to the
shares of common stock of Viad held in the Viad Trust as of the record date for
the Distribution, (2) Viad will assign to the Company a portion of the
principal amount of the Promissory Note dated August 15, 1996 issued by the
Trustee to the Company (the “Original Note”) and (3) the trustee of such new
trust will assume in favor of the Company, and Viad will release the Viad Trust
from, such portion of the Original Note; and



          WHEREAS, the Company desires to establish a trust (the “Trust”) to
implement the foregoing; and



          WHEREAS, the Trustee desires to act as trustee of the Trust, and to hold
legal title to the assets of the Trust, in trust, for the purposes hereinafter
stated and in accordance with the terms hereof;



          WHEREAS, the Company or its subsidiaries have previously adopted the Plans
(as defined below);



          WHEREAS, the Company desires to provide assurance of the availability of
the shares of Company Stock necessary to satisfy certain of its obligations or
those of its subsidiaries under the Plans (as defined below);



          WHEREAS, the Company desires that the assets to be held in the Trust Fund
(as defined below) should be principally or exclusively securities of the
Company and, therefore, expressly waives any diversification of investments
that might otherwise be necessary, appropriate, or required pursuant to
applicable provisions of law; and



-4-









 





          NOW, THEREFORE, the parties hereto hereby enter into the Trust Agreement
and the Trust and agree that the Trust will be comprised, held and disposed of
as follows:



ARTICLE 1.




Trust, Trustee and Trust Fund




          1.1. Trust. This Agreement and the Trust shall be known as the MoneyGram
Employee Equity Trust. The parties intend that the Trust will be an
independent legal entity with title to and power to convey all of its assets.
The parties hereto further intend that the Trust not be subject to the Employee
Retirement Income Security Act of 1974, as amended. The Trust is not a part of
any of the Plans (as herein defined) and does not provide retirement or other
benefits to any Plan Participant (as herein defined). The assets of the Trust
will be held, invested and disposed of by the Trustee, in accordance with the
terms of the Trust.



          1.2. Trustee. The trustee named above, and its successor or successors,
is hereby designated as the trustee hereunder, to receive, hold, invest,
administer and distribute the Trust Fund in accordance with this Agreement, the
provisions of which shall govern the power, duties and responsibilities of the
Trustee.



          1.3. Trust Fund. The assets held at any time and from time to time under
the Trust collectively are herein referred to as the “Trust Fund” and shall
consist of contributions received by the Trustee, proceeds of any loans,
investments and reinvestment thereof, the earnings and income thereon, less
disbursements therefrom. Except as herein otherwise provided, title to the
assets of the Trust Fund shall at all times be vested in the Trustee and
securities that are part of the Trust Fund shall be held in such manner that
the Trustee’s name and the fiduciary capacity in which the securities are held
are fully disclosed, subject to the right of the Trustee to hold title in
bearer form or in the name of a nominee, and the interests of others in the
Trust Fund shall be only the right to have such assets received, held,
invested, administered and distributed in accordance with the provisions of the
Trust.



          1.4. Trust Fund Subject to Claims. Notwithstanding any provision of this
Agreement to the contrary, the Trust Fund shall at all times remain subject to
the claims of the Company’s general creditors under federal and state law.



          In addition, the Board of Directors and the Chief Executive Officer of the
Company shall have the duty to inform the Trustee in writing of the Company’s
Insolvency. If a person claiming to be a creditor of the Company alleges in
writing to the Trustee that the Company has become Insolvent, the Trustee shall
determine whether the Company is Insolvent and, pending such determination, the
Trustee shall discontinue allocations pursuant to Article 3.



          Unless the Trustee has actual knowledge of the Company’s Insolvency, or
has received notice from the Company or a person claiming to be a creditor
alleging that the Company is Insolvent, the Trustee shall have no duty to
inquire whether the Company is Insolvent. The Trustee may in all events rely
on such evidence concerning the Company’s
solvency as may be furnished to the Trustee and that provides the Trustee
with a reasonable basis for making a determination concerning the Company’s
Insolvency.



-5-









 





          If at any time the Trustee has determined that the Company is Insolvent,
the Trustee shall discontinue allocations pursuant to Article 3 and shall hold
the Trust Fund for the benefit of the Company’s general creditors. Nothing in
this Trust Agreement shall in any way diminish any rights of employees as
general creditors of the Company with respect to benefits due under the Plan(s)
or otherwise.



          The Trustee shall resume allocations pursuant to Article 3 only after the
Trustee has determined that the Company is not Insolvent (or is no longer
Insolvent).



          1.5. Definitions. In addition to the terms defined in the preceding
portions of the Trust, certain capitalized terms have the meanings set forth
below:



          Basket Value. “Basket Value” means with respect to each Trust Year, the
product of (a) the Available Shares for such Trust Year, (b) the product of
four and the Company’s most recent reported quarterly earnings per share, and
(c) the equal weighted average price earnings ratio of the following companies
(or any successor of such companies) as reported in the Wall Street Journal on
the last business day of such Trust Year: First Data Corp; Global Payment
Inc.; and Total Systems Services.



          Board of Directors. “Board of Directors” means the board of directors of
the Company.



          Calculation Period. “Calculation Period” means a period consisting of
July 1, 2004 – December 31, 2007, or calendar years 2008 — 2012.



          Change of Control. “Change of Control” means any of the following events:



          (a) An acquisition by an individual, entity or group (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)) of 20% or more of
either: (1) the then outstanding shares of Common Stock of the Company (the
“Outstanding Company Common Stock”) or (2) the combined voting power of the
then Outstanding Voting Securities of the Company entitled to vote generally in
the election of Directors (the “Outstanding Company Voting Securities”);
excluding, however the following: (A) any acquisition directly from the
Company or any entity controlled by the Company other than an acquisition by
virtue of the exercise of a conversion privilege unless the security being so
converted was itself acquired directly from the Company or any entity
controlled by the Company, (B) any acquisition by the Company, or any entity
controlled by the Company, (C) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the Company or any entity controlled
by the Company or (D) any acquisition pursuant to a transaction which complies
with clauses (1), (2) and (3) of paragraph (c) of this definition; or



          (b) A change in the composition of the Board such that the individuals
who, as of the effective date of the Plan, constitute the Board (such Board
shall be hereinafter referred to as the “Incumbent Board”) cease for any reason
to constitute at least a majority of the Board; provided, however, for purposes
of this paragraph (b) that any individual, who becomes a member of the Board
subsequent to the effective date of the Plan, whose election, or nomination



-6-









 





for
election by the Company’s shareholders, was approved by a vote of at least a
majority of those individuals who are members of the Board and who were also
members of the Incumbent Board, (or deemed to be such pursuant to this proviso)
shall be considered as though such individual were a member of the Incumbent
Board; but provided further, that any such individual whose initial assumption
of office occurs as a result of either an actual or threatened election contest
(as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the
Exchange Act) or other actual or threatened solicitation of proxies or consents
by or on behalf of a Person other than the Board shall not be so considered as
a member of the Incumbent Board, or



          (c) Consummation of a reorganization, merger or consolidation or sale or
other disposition of all or substantially all of the assets of the Company (a
“Corporate Transaction”) excluding, however, such a Corporate Transaction
pursuant to which (1) all or substantially all of the individuals and entities
who are the beneficial owners, respectively, of the Outstanding Company Common
Stock and Outstanding Company Voting Securities immediately prior to such
Corporate Transaction (the “Prior Shareholders”) beneficially own, directly or
indirectly, more than 60% of, respectively, the outstanding shares of Common
Stock and the combined voting power of the then Outstanding Voting Securities
entitled to vote generally in the election of Directors, as the case may be, of
the Company or other entity resulting from such Corporate Transaction
(including, without limitation, a corporation or other entity which as a result
of such transaction owns the Company or all or substantially all of the
Company’s assets either directly or through one or more subsidiaries) in
substantially the same proportions as their ownership, immediately prior to
such Corporate Transaction, of the Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case may be, (2) no Person (other
than the Company or any entity controlled by the Company, any employee benefit
plan (or related trust) of the Company or any entity controlled by the Company
or such corporation or other entity resulting from such Corporate Transaction)
will beneficially owns, directly or indirectly, 20% or more of, respectively,
the outstanding shares of Common Stock of the Company or other entity
resulting from such Corporate Transaction or the combined voting power of the
Outstanding Voting Securities of such Company or other entity entitled to vote
generally in the election of Directors except to the extent that such ownership
existed prior to the Corporate Transaction and (3) individuals who were members
of the Incumbent Board will constitute at least a majority of the members of
the Board of Directors of the Company resulting from such Corporate
Transaction; and further excluding any disposition of all or substantially all
of the assets of the Company pursuant to a spin-off, split-up or similar
transaction (a “Spin-off”) if, immediately following the Spin-off, the Prior
Shareholders beneficially own, directly or indirectly, more than 80% of the
outstanding shares of Common Stock and the combined voting power of the then
Outstanding Voting Securities entitled to vote generally in the election of
directors of both entities resulting from such transaction, in substantially
the same proportions as their ownership, immediately prior to such transaction,
of the Outstanding Company Common Stock and Outstanding Company Voting
Securities; provided, that if another Corporate Transaction involving the
Company occurs in connection with or following a Spin-off, such Corporate
Transaction shall be analyzed separately for purposes of determining
whether a Change of Control has occurred; or



          (d) The approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company.



-7-









 





          Code. “Code” means the Internal Revenue Code of 1986, as amended.



          Committee. “Committee” means a committee of officers, directors and/or
employees of the Company which is charged by the Board of Directors with
administration of the Trust.



          Company. “Company” means MoneyGram International, Inc., a Delaware
corporation, or any successor thereto. References to the Company shall include
its subsidiaries where appropriate.



          Company Stock. “Company Stock” means shares of common stock, par value
$0.01 per share, issued by the Company or any successor securities.



          DC Participant. “DC Participant” means as of any date any individual who
is employed by the Company or any subsidiary of the Company as of such date and
is a participant in a DC Plan.



          DC Plan. “DC Plan” shall mean the MoneyGram 401(k) Plan and any successor
thereto.



          DC Plan Trustee Certification. “DC Plan Trustee Certification” means a
certification to be delivered by the trustee of the DC Plan to the Trustee
pursuant to Section 5.4, which sets forth the directions made by each DC
Participant as to voting or tendering of Company Stock allocated to his account
in the DC Plan with respect to the voting or tendering decision at issue.



          Extraordinary Dividend. “Extraordinary Dividend” means any dividend or
other distribution of cash or other property (other than Company Stock) made
with respect to Company Stock, which the Board of Directors declares generally
to be other than an ordinary dividend.



          Fair Market Value. “Fair Market Value” means as of any date the average
of the highest and lowest reported sales price regular way during normal
business hours on such date (or if such date is not a trading day, then on the
most recent prior date which is a trading day) of a share of Company Stock as
reported on the composite tape, or similar reporting system, for issues listed
on the New York Stock Exchange (or, if the Company Stock is no longer traded on
the New York Stock Exchange, on such other national securities exchange on
which the Company Stock is listed or national securities or central market
system upon which transactions in Company Stock are reported, as either shall
be designated by the Committee for the purposes hereof) or if sales of Common
Stock are not reported in any manner specified above, the average of the high
bid and low asked quotations on such date (or if such date is not a trading
day, then on the most recent prior date which is a trading day) in the
over-the-counter market as reported
by the National Association of Securities Dealers’ Automated Quotation
System or, if not so reported, by National Quotation Bureau, Incorporated or
similar organization selected by the Committee.



          Final Target Value. “Final Target Value” means with respect to each Trust
Year the greater of (a) the Target Value and (b) the Basket Value.



-8-









 





          Insolvency. “Insolvency” means (a) the inability of the Company to pay
its debts as they become due, or (b) the Company being subject to a pending
proceeding as a debtor under the provisions of Title 11 of the United States
Code (Bankruptcy Code).



          Loan. “Loan” means the portion of the Viad Loan assumed by the Trustee
pursuant to an Assignment, Assumption and Release Agreement dated as of June
30, 2004.



          Plans. “Plans” mean the DC Plan, the employee benefit plans listed on
Schedule A hereto and any other employee benefit plan of the Company or its
subsidiaries designated as such by the Board of Directors.



          Plan Participant. “Plan Participant” means a participant in any of the
Plans.



          Suspense Account. “Suspense Account” means a separate account to be
maintained by the Trustee to hold Excess Shares pursuant to the terms of
Article 3 hereof.



          Target Value. “Target Value” for a given Trust Year means the amount set
forth on Schedule B hereto.



          Trustee. “Trustee” means Wells Fargo Bank, N.A., a national banking
association (not in its corporate capacity but as trustee of the Trust), or any
successor trustee.



          Trust Year. “Trust Year” means the period beginning on July 1, 2004 and
ending on December 31, 2004 and each 12-month period beginning on January 1 and
ending on December 31 thereafter.



          Viad Loan. “Viad Loan” means the loan and extension of credit to the Viad
Trust evidenced by the promissory note made by the Trustee of the Viad Trust
dated September 9, 1992, with which the Trustee of the Viad Trust purchased
Company Stock, as amended as of August 15, 1996 to reduce the remaining
principal amount as a result of the assignment to Dial, and the assumption by
the trustee of a new trust established by Dial, of a portion of the remaining
principal amount of the Original Note specified in Section 3.5 of the Viad
Trust.



ARTICLE 2.




Contributions and Dividends




          2.1. Contributions. For each Trust Year the Company shall contribute to
the Trust in cash such amount, which together with dividends, as provided in
Section 2.2, and any other earnings of the Trust, shall enable the Trustee to
make all payments of principal and interest due under the Loan on a timely
basis.
Unless otherwise expressly provided herein, the Trustee shall apply all
such contributions, dividends and earnings to the payment of principal and
interest due under the Loan. If, at the end of any Trust Year, no such
contribution has been made in cash, such contribution shall be deemed to have
been made in the form of forgiveness of principal and interest on the Loan to
the extent of the Company’s failure to make contributions as required by this
Section 2.1. All contributions made under the Trust shall be delivered to the
Trustee. The Trustee shall be accountable for all contributions received by
it, but shall have no duty to require any contributions to be made to it.



-9-









 





          2.2. Dividends. Except as otherwise provided herein, dividends paid in
cash on Company Stock held by the Trust, including Company Stock held in the
Suspense Account, shall be applied to pay interest and repay scheduled
principal due under the Loan. In the event that dividends paid on Company
Stock held in the Trust, other than Extraordinary Dividends, exceed the amount
of scheduled principal and interest due in any Trust Year, such excess shall be
distributed to the Plans and/or to any other broad cross-section of individuals
employed by the Company, as determined in good faith by the Committee;
provided, however, that in the event that in any Trust Year cash dividends on
Company Stock held by the Trust exceed the amount indicated on Schedule C
hereto, other than by reason of an Extraordinary Dividend, such excess shall be
applied to prepay principal of the Loan. Extraordinary Dividends, as well as
dividends which are not in cash or in Company Stock, shall not be used to pay
interest on or principal of the Loan, but shall be reduced to cash by the
Trustee and reinvested in Company Stock as soon as practicable. Company Stock
purchased with the proceeds of an Extraordinary Dividend or with the proceeds
of a non-cash dividend shall, for purposes of this Agreement (including without
limitation Section 3.1 hereof), be deemed to have been acquired with the
proceeds of the Loan. In the Trustee’s discretion, investments in Company
Stock may be made through open-market purchases, private transactions or (with
the Company’s consent) purchases from the Company.



ARTICLE 3.




Release and Allocation of Company Stock




          3.1. Release of Shares. Subject to the other provisions of this Article
3, upon the payment or forgiveness in any Trust Year of any principal on the
Loan (a “Principal Payment”), the following number of shares of Company Stock
acquired with the proceeds of the Loan shall be available for allocation
(“Available Shares”) as provided in this Article 3: the number of shares so
acquired and held in the Trust immediately before such payment or forgiveness,
multiplied by a fraction the numerator of which is the amount of the Principal
Payment and the denominator of which is the sum of such Principal Payment and
the remaining principal of the Loan outstanding after such Principal Payment.



          3.2. Allocations. Subject to the provisions of Section 3.3, Available
Shares shall be allocated as directed by the Committee to the Plans on a
quarterly basis or at such other times during the Trust Year as may be required
to provide shares in accordance with the respective regular payment schedules
for benefits under such Plans. The
Committee’s discretion shall be limited to the number of shares of Company
Stock allocated among Plans, with the allocation itself being mandatory.
Subject to Section 3.3, in the event that as of December 31 of any given Trust
Year, any unallocated Available Shares remain after satisfaction of all benefit
obligations under each of the Plans for a given Trust Year, and/or after
determination of the amount, if any, of Excess Shares, under Section 3.3, all
remaining Available Shares shall be contributed by the Trustee to the Plans or
such other plans of the Company or its subsidiaries covering a broad
cross-section of individuals employed by the Company as the Committee shall
direct.



          3.3. Excess Shares. (a) Notwithstanding the provisions of Section 3.2,
Available Shares shall not be released from the Trust and allocated during a
given Trust Year



-10-









 





pursuant to Section 3.2 to the extent that the Fair Market
Value of the Available Shares theretofore allocated during such Trust Year, as
of the date(s) of allocation, together with the Fair Market Value of the
Available Shares proposed to be allocated, as of the date(s) of proposed
allocation, exceeds the Target Value. If, as of December 31 of such Trust
Year, the Fair Market Value of the Available Shares theretofore allocated
during such Trust Year, as of the date(s) of allocation, together with the
Available Shares for such Trust Year not yet allocated, exceeds the Final
Target Value, the Available Shares with a Fair Market Value as of December 31
in an amount equal to such excess shall not be released and allocated pursuant
to this Section 3.2 but rather, such Available Shares (“Excess Shares”) shall
be held by the Trustee in the Suspense Account and allocated in accordance with
the provisions of this Section 3.3.




          (b) In the event that there are any Excess Shares created in any Trust
Year within a Calculation Period, such Excess Shares shall be released from the
Suspense Account pursuant to Section 3.2 to the extent that but for such
release the Fair Market Value of the Available Shares in a subsequent Trust
Year within the same Calculation Period would be less than the Final Target
Value. In the event that in any Trust Year the value of the Available Shares
was less than the Final Target Value for such Trust Year (such amount being
referred to as the “Shortfall”) and Excess Shares are created in subsequent
Trust Year within the same Calculation Period, Excess Shares with a value
equal to the Shortfall shall be transferred by the Trustee to such Plans as
directed by the Committee; it being understood, that such shares may not, in
any event, be transferred to the Company.



          (c) In the event that at the end of any Calculation Period there are
Excess Shares that have not been allocated pursuant to Section 3.3(b), such
Excess Shares shall, subject to the provisions of this subsection (c), be
distributed in equal amounts of shares in each Trust Year in the next
Calculation Period to individuals employed by the Company or plans in which
they participate, as directed by the Committee taking into account the best
interest of the individuals employed by the Company and its subsidiaries.
However, Excess Shares which would have been allocated in a Trust Year pursuant
to the preceding sentence shall instead be allocated pursuant to Section 3.2 to
the extent that there is a Shortfall with respect to such Trust Year. Any
Excess Shares remaining in the Trust at the beginning of the final Calculation
Period of the Trust shall be contributed in equal amounts of shares in each
Trust Year during such Calculation Period to individuals employed by the
Company or plans in which they participate, as directed by the Committee taking
into account the best interest of the individuals employed by
the Company and its subsidiaries, and the Trust shall not terminate until
such Excess Shares have been so contributed.



ARTICLE 4.




Compensation, Expenses and Tax Withholding




          4.1. Compensation and Expenses. The Trustee shall be entitled to such
reasonable compensation for its services as may be agreed upon from time to
time by the Company and the Trustee and to be reimbursed for its reasonable
legal, accounting and appraisal fees, expenses and other charges reasonably
incurred in connection with the administration, management, investment and
distribution of the Trust Fund. Such compensation shall be paid, and such
reimbursement shall be made out of the Trust Fund. The Company agrees to make



-11-









 





sufficient contributions to the Trust to pay such amounts owing the Trustee in
addition to those contributions required by Section 2.1 and, in the event the
Company fails to make the contributions necessary to pay amounts owing to the
Trustee, the Trustee shall be entitled to seek payment directly from the
Company.




     4.2. Withholding of Taxes. The Trustee may withhold, require withholding,
or otherwise satisfy its withholding obligation, on any distribution which it
is directed to make, such amount as it may reasonably estimate to be necessary
to comply with applicable federal, state and local withholding requirements.
Upon settlement of such tax liability, the Trustee shall distribute the balance
of such amount. Prior to making any distribution hereunder, the Trustee may
require such release or documents from any taxing authority, or may require
such indemnity, as the Trustee shall reasonably deem necessary for its
protection.



ARTICLE 5.




Administration of Trust Fund




          5.1. Management and Control of Trust Fund. Subject to the terms of this
Agreement, the Trustee shall have exclusive authority, discretion and
responsibility to manage and control the assets of the Trust Fund.



          5.2. Investment of Funds.



          Except as otherwise provided in Section 2.2 and in this Section 5.2, the
Trustee shall invest and reinvest the Trust Fund exclusively in Company Stock,
including any accretions thereto resulting from the proceeds of a tender offer,
recapitalization or similar transaction which, if not in Company Stock, shall
be reduced to cash as soon as practicable. The Trustee may invest any portion
of the Trust Fund temporarily pending investment in Company Stock, distribution
or payment of expenses in (a) investments in United States Government
obligations with maturities of less than one year, (b) interest-bearing
accounts including but not limited to certificates of deposit, time deposits,
saving accounts and money market accounts with maturities
of less than one year in any bank, including the Trustee’s, with aggregate
capital in excess of $1,000,000,000 and a Moody’s Investor Services rating of
at least P1, or an equivalent rating from a nationally recognized ratings
agency, which accounts are insured by the Federal Deposit Insurance Corporation
or other similar federal agency, (c) obligations issued or guaranteed by any
agency or instrumentality of the United States of America with maturities of
less than one year or (d) short-term discount obligations of the Federal
National Mortgage Association.



          5.3. Trustee’s Administrative Powers.



          Except as otherwise provided herein, and subject to the Trustee’s duties
hereunder, the Trustee shall have the following powers and rights, in addition
to those provided elsewhere in this Agreement or by law:



          (a) to retain any asset of the Trust Fund;



-12-









 






     (b) subject to Section 5.4 and Article 3, to sell, transfer,
mortgage, pledge, lease or otherwise dispose of, or grant options with
respect to any Trust Fund assets at public or private sale;




     (c) upon direction from the Company, to borrow from any lender
(including the Company pursuant to the Loan), to acquire Company Stock as
authorized by this Agreement, to enter into lending agreements upon such
terms (including reasonable interest and security for the loan and rights
to renegotiate and prepay such loan) as may be determined by the
Committee; provided, however, that any collateral given by the Trustee
for the Loan shall be limited to cash and property contributed by the
Company to the Trust and dividends paid on Company Stock held in the
Trust Fund and shall not include Company Stock acquired with the proceeds
of Loan;




     (d) with the consent of the Committee, to settle, submit to
arbitration, compromise, contest, prosecute or abandon claims and demands
in favor of or against the Trust Fund;




     (e) to vote or to give any consent with respect to any securities,
including any Company Stock, held by the Trust either in person or by
proxy for any purpose, provided that the Trustee shall vote, tender or
exchange all shares of Company Stock as provided in Section 5.4;




     (f) to exercise any of the powers and rights of an individual owner
with respect to any asset of the Trust Fund and to perform any and all
other acts that in its judgment are necessary or appropriate for the
proper administration of the Trust Fund, even though such powers, rights
and acts are not specifically enumerated in this Agreement;




     (g) to employ such accountants, actuaries, investment bankers,
appraisers, other advisors and agents as may be reasonably necessary in
collecting, managing, administering, investing, valuing, distributing and
protecting the Trust Fund or the assets thereof or any borrowings of the
Trustee made in accordance with Section 5.3(c); and to
pay their reasonable fees and expenses, which shall be deemed to be
expenses of the Trust and for which the Trustee shall be reimbursed in
accordance with Section 4.1;




     (h) to cause any asset of the Trust Fund to be issued, held or
registered in the Trustee’s name or in the name of its nominee, or in
such form that title will pass by delivery, provided that the records of
the Trustee shall indicate the true ownership of such asset;




     (i) to utilize another entity as custodian to hold, but not invest
or otherwise manage or control, some or all of the assets of the Trust
Fund; and




     (j) to consult with legal counsel (who may also be counsel for the
Trustee generally) with respect to any of its duties or obligations
hereunder; and to pay the reasonable fees and expenses of such counsel,
which shall be deemed to be expenses of the Trust and for which the
Trustee shall be reimbursed in accordance with Section 4.1.



-13-









 






     Notwithstanding the foregoing, neither the Trust nor the Trustee shall
have any power to, and shall not, engage in any trade or business.



          5.4. Voting and Tendering of Company Stock.



          (a) Voting of Company Stock. The Trustee shall follow the directions of
the trustee of the DC Plan as to the manner in which shares of Company Stock
held by the Trust are to be voted on each matter brought before an annual or
special stockholders’ meeting of the Company or the manner in which any consent
is to be executed, in each case as provided below. Before each such meeting of
stockholders, the Trustee shall cause to be furnished to the trustee of the DC
Plan a copy of the proxy solicitation material received by the Trustee,
together with a form requesting confidential instructions as to how to vote the
shares of Company Stock held by the Trustee. Upon timely receipt of the DC
Plan Trustee Certification, the Trustee shall on each such matter vote the
number of shares (including fractional shares) of Company Stock held by the
Trust as follows:



          The Trustee shall, with respect to each DC Plan, assign to each DC
Participant, a number of shares (the “DC Participant Directed Amount”) equal to
the product of (i) the total number of shares of Common Stock held in the Trust
Fund, and (ii) a fraction, the numerator of which is the number of shares of
Company Stock allocated from the Trust Fund to such DC Participant’s account in
the DC Plan for the most recent preceding Trust Year and the denominator of
which is the total number of shares of Company Stock contributed by the Trustee
to the trustees of the trusts established under the DC Plan with respect to
such Trust Year, in each case, as reflected in the DC Plan Trustee
Certification. Each share assigned to each DC Participant in accordance with
the previous sentence shall be voted in accordance with such participant’s
direction to the trustee of the DC Plan in which he participates with respect
to shares of Company Stock allocated to his account in such DC Plan, as
reflected in the DC Plan Trustee Certification. Any shares of Company Stock
which remain undirected pursuant to the foregoing provisions shall be voted
for, against or to abstain in the same proportions as the
            shares of Company Stock for which the Trustee is directed as provided
above. Similar provisions shall apply in the case of any action by shareholder
consent without a meeting.



          (b) Tender or Exchange of Company Stock. The Trustee shall use its best
efforts timely to distribute or cause to be distributed to the trustee of any
trust established under any DC Plan any written materials distributed to
stockholders of the Company generally in connection with any tender offer or
exchange offer, together with a form requesting confidential instructions on
whether or not to tender or exchange shares of Company Stock held in the Trust.
Upon timely receipt of the DC Plan Trustee Certification, the Trustee shall
tender or not tender the DC Participant Directed Amount for each DC Participant
in accordance with such participant’s direction to the trustee of the DC Plan
in which he participates with respect to shares of Company Stock allocated to
his account in such DC Plan, as set forth in the DC Plan Trustee Certification.
The trustee of any DC Plan shall not be limited in the number of instructions
to tender or withdraw from tender which it may give but shall not have the
right to give instructions to tender or withdraw from tender after a reasonable
time established by the Trustee. If the Trustee shall not receive timely
instruction by means of the DC Plan Trustee Certification as to the manner in
which to respond to such a tender or exchange offer, the Trustee



-14-









 





shall not
tender or exchange any shares of Company Stock with respect to which the
trustee of any DC Plan has the right of direction, and the Trustee shall have
no discretion in such matter.




          (c) The Company shall maintain appropriate procedures to ensure that all
instructions by DC Participants are collected, tabulated, and transmitted to
the trustee under the DC Plan and to the Trustee without being divulged or
released to any person affiliated with the Company or its affiliates. All
actions taken by DC Participants and the contents of the DC Plan Trustee
Certification shall be held confidential by the Trustee and shall not be
divulged or released to any person, other than (i) agents of the Trustee who
are not affiliated with the Company or its affiliates or (ii) by virtue of the
execution by the Trustee of any proxy, consent or letter of transmittal for the
shares of Company Stock held in the Trust.



          5.5. Indemnification.



          (a) The Company shall and hereby does indemnify and hold harmless the
Trustee from and against any claims, demands, actions, administrative or other
proceedings, causes of action, liability, loss, cost, damage or expense
(including reasonable attorneys’ fees), which may be asserted against it, in
any way arising out of or incurred as a result of its action or failure to act
in connection with the operation and administration of the Trust; provided that
such indemnification shall not apply to the extent that the Trustee has acted
in willful or negligent violation of applicable law or its duties under this
Trust or in bad faith. The Trustee shall be under no liability to any person
for any loss of any kind which may result (i) by reason of any action taken by
it in accordance with any direction of the Committee or any DC Participant
acting pursuant to Section 5.4 (hereinafter collectively referred to as the
“directing participants”), (ii) by reason of its failure to exercise any power
or authority or to take any action hereunder because of the failure of any such
directing participant to give directions to the Trustee, as provided for in
this Agreement, or (iii) by reason of any act or omission of any of the
directing participants with respect to its duties under this Trust. The
Trustee shall be fully protected in acting upon any instrument, certificate, or
paper delivered by the Committee or any DC Participant or beneficiary and
believed in good faith by the Trustee to be genuine and to be
signed or presented by the proper person or persons, and the Trustee shall
be under no duty to make any investigation or inquiry as to any statement
contained in any such writing, but may accept the same as conclusive evidence
of the truth and accuracy of the statements therein contained.



          (b) The Company may, but shall not be required to, maintain liability
insurance to insure its obligations hereunder. If any payments made by the
Company or the Trust pursuant to this indemnity are covered by insurance, the
Company or the Trust (as applicable) shall be subrogated to the rights of the
indemnified party against the insurance company.



          (c) Without limiting the generality of the foregoing, the Company may, at
the request of the Trustee, advance to the Trustee reasonable amounts of
expenses, including reasonable attorneys’ fees and expenses, which the Trustee
advises have been incurred in connection with its investigation or defense of
any claim, demand, action, cause of action, administrative or other proceeding
arising out of or in connection with the Trustee’s performance of its duties
under this Agreement.



-15-









 





          5.6. General Duty to Communicate to Committee. The Trustee shall promptly
notify the Committee of all communications with or from any government agency
or with respect to any legal proceeding with regard to the Trust and with or
from any Plan Participants concerning their entitlements under the Plans or the
Trust.



ARTICLE 6.




Accounts and Reports of Trustee




          6.1. Records and Accounts of Trustee. The Trustee shall maintain accurate
and detailed records and accounts of all transactions of the Trust, which shall
be available at all reasonable times for inspection or audit by any person
designated by the Company and which shall be retained as required by applicable
law.



          6.2. Fiscal Year. The fiscal year of the Trust shall be the twelve month
period beginning on January 1 and ending on December 31.



          6.3. Reports of Trustee. The Trustee shall prepare and present to the
Committee a report for the period ending on the last day of each fiscal year,
and for such shorter periods as the Committee may reasonably request, listing
all securities and other property acquired and disposed of and all receipts,
disbursements and other transactions effected by the Trust after the date of
the Trustee’s last account, and further listing all cash, securities, and other
property held by the Trust, together with the fair market value thereof, as of
the end of such period. In addition to the foregoing, the report shall contain
such information regarding the Trust Fund’s assets and transactions as the
Committee in its discretion may reasonably request.



          6.4. Final Report. In the event of the resignation or removal of a
Trustee hereunder, the Committee may request and the Trustee shall then with
reasonable promptness submit, for the period ending on the effective date of
such resignation or removal, a report similar in form and purpose to that
described in Section 6.3.



ARTICLE 7.




Succession of Trustee




          7.1. Resignation of Trustee. The Trustee or any successor thereto may
resign as Trustee hereunder at any time upon delivering a written notice of
such resignation, to take effect sixty (60) days after the delivery thereof to
the Committee, unless the Committee accepts shorter notice; provided, however,
that no such resignation shall be effective until a successor Trustee has
assumed the office of Trustee hereunder.



          7.2. Removal of Trustee. The Trustee or any successor thereto may be
removed by the Company by delivering to the Trustee so removed an instrument
executed by the Committee. Such removal shall take effect at the date
specified in such instrument, which shall not be less than sixty (60) days
after delivery of the instrument, unless the Trustee accepts shorter notice;
provided, however, that no such removal shall be effective until a successor
Trustee has assumed the office of Trustee hereunder.



-16-









 





          7.3. Appointment of Successor Trustee. Whenever the Trustee or any
successor thereto shall resign or be removed or a vacancy in the position shall
otherwise occur, the Board of Directors shall use its best efforts to appoint a
successor Trustee as soon as practicable after receipt by the Committee of a
notice described in Section 7.1, or the delivery to the Trustee of a notice
described in Section 7.2, as the case may be, but in no event more than
seventy-five (75) days after receipt or delivery, as the case may be, of such
notice. A successor Trustee’s appointment shall not become effective until
such successor shall accept such appointment by delivering its acceptance in
writing to the Company. If a successor is not appointed within such 75 day
period, the Trustee, at the Company’s expense, may petition a court of
competent jurisdiction for appointment of a successor.



          7.4. Succession to Trust Fund Assets. The title to all property held
hereunder shall vest in any successor Trustee acting pursuant to the provisions
hereof without the execution or filing of any further instrument, but a
resigning or removed Trustee shall execute all instruments and do all acts
necessary to vest title in the successor Trustee. Each successor Trustee shall
have, exercise and enjoy all of the powers, both discretionary and ministerial,
herein conferred upon its predecessors. A successor Trustee shall not be
obliged to examine or review the accounts, records, or acts of, or property
delivered by, any previous Trustee and shall not be responsible for any action
or any failure to act on the part of any previous Trustee.



          7.5. Continuation of Trust. In no event shall the legal disability,
resignation or removal of a Trustee terminate the Trust, but
the Board of Directors shall forthwith appoint a successor Trustee in
accordance with Section 7.3 to carry out the terms of the Trust.



          7.6. Changes in Organization of Trustee. In the event that any corporate
Trustee hereunder shall be converted into, shall merge or consolidate with, or
shall sell or transfer substantially all of its assets and business to,
another corporation, state or federal, the corporation resulting from such
conversion, merger or consolidation, or the corporation to which such sale or
transfer shall be made, shall thereunder become and be the Trustee under the
Trust with the same effect as though originally so named.



          7.7. Continuance of Trustee’s Powers in Event of Termination of the Trust.
In the event of the termination of the Trust, as provided herein, the Trustee
shall dispose of the Trust Fund in accordance with the provisions hereof.
Until the final distribution of the Trust Fund, the Trustee shall continue to
have all powers provided hereunder as necessary or expedient for the orderly
liquidation and distribution of the Trust Fund.



ARTICLE 8.




Amendment or Termination




          8.1. Amendments. Except as otherwise provided herein, the Company may
amend the Trust at any time and from time to time in any manner which it deems
desirable, provided that no amendment which would adversely affect the
contingent rights of Plan Participants may change (a) the allocation formula
contained in Section 3.1 or Section 3.2 so as to change the Fair Market Value
in any Trust Year of the Available Shares or the Excess Shares, (b) the terms
of Section 3.3, (c) the Target Value reflected on Schedule B with respect to
any



-17-









 





Trust Year, (d) the provisions of Section 2.2 as to the use of dividends in
excess of the amounts reflected on Schedule C, (e) the provisions of Section
5.4, (f) the provisions of Section 8.2, (g) the provisions of this Section 8.1,
or (h) change the duties of the Trustee without the Trustee’s consent, which
consent shall not be unreasonably withheld. Notwithstanding the foregoing, the
Company shall retain the power under all circumstances to amend the Trust to
correct any errors or clarify any ambiguities or similar issues of
interpretation in this Agreement.




          8.2. Termination. Subject to the terms of Section 3.3(c) and this Section
8.2, the Trust shall terminate on September 8, 2012 or any earlier date on
which the Loan is paid in full (the “Termination Date”). The Board of
Directors may terminate the Trust at any time prior to the Termination Date.
The Trust shall also terminate automatically upon the Company giving the
Trustee notice of a Change of Control. Immediately upon a termination of the
Trust, the Company shall be deemed to have forgiven all amounts then
outstanding under the Loan. As soon as practicable after receiving notice
from the Company of a Change of Control or upon any other termination of the
Trust, the Trustee shall sell all of the Company Stock and other non-cash
assets (if any) then held in the Trust Fund as directed by the Committee in
good faith taking into account the interests of a broad cross-section of
individuals employed by the Company. The proceeds of such sale shall first be
returned to the
Company up to an amount equal to the principal amount, plus any accrued
interest, of the Loan that was forgiven upon such termination. Subject to the
provisions of Section 3.3(c), any funds remaining in the Trust after such
payment to the Company shall be distributed with reasonable promptness to a
broad cross-section of Plan Participants or to individuals employed by the
Company generally or to any benefit plan or trust in which a broad
cross-section of individuals employed by the Company participate, as the
Committee may in good faith determine taking into account the best interests of
the individuals employed by the Company.



          8.3. Form of Amendment or Termination. Any amendment or termination of
the Trust shall be evidenced by an instrument in writing signed by an
authorized officer of the Company, certifying that said amendment or
termination has been authorized and directed by the Company or the Board of
Directors, as applicable, and, in the case of any amendment, shall be consented
to by signature of an authorized officer of the Trustee, if required by Section
8.1.



ARTICLE 9.




Miscellaneous




          9.1. Controlling Law. The laws of the State of Delaware shall be the
controlling law in all matters relating to the Trust, without regard to
conflicts of law.



          9.2. Committee Action. Any action required or permitted to be taken by
the Committee may be taken on behalf of the Committee by any individual so
authorized. The Company shall furnish to the Trustee the name and specimen
signature of each member of the Committee upon whose statement of a decision or
direction the Trustee is authorized to rely. Until notified of a change in the
identity of such person or persons, the Trustee shall act upon the assumption
that there has been no change.



-18-









 





          9.3. Notices. All notices, requests, or other communications required or
permitted to be delivered hereunder shall be in writing, delivered by
registered or certified mail, return receipt requested as follows:



To the Company:



MoneyGram
International, Inc. 



1550 Utica Avenue South 



St. Louis Park, Minnesota 55416 



Attention: General Counsel



To the Trustee:



Wells Fargo Bank, N.A.


6th and Marquette 



Mail: N9303-110 



Minneapolis, MN 55479 



Attention: Nancy Sampair



Any party hereto may from time to time, by written notice given as aforesaid,
designate any other address to which notices, requests or other communications
addressed to it shall be sent.



          9.4. Severability. If any provision of the Trust shall be held illegal,
invalid or unenforceable for any reason, such provision shall not affect the
remaining parts hereof, but the Trust shall be construed and enforced as if
said provision had never been inserted herein.



          9.5. Protection of Persons Dealing with the Trust. No person dealing with
the Trustee shall be required or entitled to monitor the application of any
money paid or property delivered to the Trustee, or determine whether or not
the Trustee is acting pursuant to authorities granted to it hereunder or to
authorizations or directions herein required.



          9.6. Tax Status of Trust. It is intended that the Company, as grantor
hereunder, be treated as the owner of the entire Trust and the trust assets
under Section 671, et seq. of the Code. Until advised otherwise, the Trustee
may presume that the Trust is so characterized for federal income tax purposes
and shall make all filings of tax returns on that presumption.



          9.7. Participants to Have No Interest in the Company by Reason of the
Trust. Neither the creation of the Trust nor anything contained in the Trust
shall be construed as giving any person, including any individual employed by
the Company or any subsidiary of the Company, any equity or interest in the
assets, business, or affairs of the Company except to the extent that any such
individuals are entitled to exercise stockholder rights with respect to Company
Stock pursuant to Section 5.4.



          9.8. Nonassignability. No right or interest of any person to receive
distributions from the Trust shall be assignable or transferable, in whole or
in part, either directly or by operation of law or otherwise, including, but
not by way of limitation, execution, levy, garnishment, attachment, pledge, or
bankruptcy, but excluding death or mental incompetency,



-19-









 





and no right or
interest of any person to receive distributions from the Trust shall be subject
to any obligation or liability of any such person, including claims for alimony
or the support of any spouse or child.




          9.9. Gender and Plurals. Whenever the context requires or permits, the
masculine gender shall include the feminine gender and the singular form shall
include the plural form and shall be interchangeable.



          9.10. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be considered an original.



-20-









 





          IN WITNESS WHEREOF, the Company and the Trustee have caused this Agreement
to be signed, and their seals affixed hereto, by their authorized officers all
as of the day, month and year first above written.


	 	 	 	 	 
	 	MONEYGRAM INTERNATIONAL, INC.

 	 
	 	By:  	                                    /s/ Teresa H. Johnson
 	 
	 	 	Name:  	Teresa Johnson 	 
	 	 	Title:  	Vice President, General Counsel
& Secretary 	 
	 



	 	 	 	 	 
	 	WELLS FARGO BANK, N.A.

 	 
	 	By:  	/s/ Todd A. Crandall
 	 
	 	 	Name:  	Todd A. Crandall 	 
	 	 	Title:  	Assistant Vice
President/Relationship Manager 	 




-21-









 






	 	 	 	 	 



SCHEDULE A





	1.	 	MoneyGram International, Inc. Supplemental 401(k) Plan
	 
	2.	 	MoneyGram International, Inc. Deferred Compensation Plan
	 
	3.	 	Travelers Express Company, Inc. Supplemental Pension Plan
4. MoneyGram Pension Plan
	 
	5.	 	Active Employee and Retiree Health and Welfare Plans
	 
	6.	 	MoneyGram International, Inc. Omnibus Incentive Plan
	 
	7.	 	MoneyGram International, Inc. Management Incentive Plan
	 
	8.	 	MoneyGram International, Inc. Executive Severance Plans (Tier I and Tier II)




-22-









 











SCHEDULE B




	 	 	 
	Trust Year
	 	Target Value ($)
	
 
	 	
 
	2004 (7/1-12/31)

2005

2006

2007
	 	25,129,749

28,747,201

32,903,423

37,752,348







-23-









 






SCHEDULE C




	 	 	 
	Trust Year
	 	Dividends ($)
	
 
	 	
 
	2004 (7/1-12/31)

2005

2006

2007
	 	$1,637,030

1,332,467

951,762

380,705








-24-